How to Use Blockchain Effectively in Auditing and Assurance Services

  • Ipek TurkerEmail author
  • Ali Altug Bicer
Part of the Contributions to Management Science book series (MANAGEMENT SC.)


The last decade has been quite innovative and revolutionary for both digital tools and financial reporting. Until now, auditing and assurance services have dealt with sorting mountains of data. With firms upgrading their business methods and internal control systems through the use of information technologies, it has become mandatory for those same information technologies to be used in auditing and assurance services. Accordingly, the quality of auditing has increased, taking out what used to be a drudgery for auditors. However, at the same time new areas of auditing and assurance services have opened up.

There has been speculation about whether the accounting information system will replace what accountants do, that is, whether blockchain systems will replace auditors. It is undeniable that when used in the audit process, blockchain systems increase the quality of the audit without increasing the time spent on the audited data. In some articles blockchain is referred to as one open, unmodifiable ledger. When auditing financial reports based on this ledger, auditors are able to increase the number of samples they use, even up to including the entire data set without increasing their work-load or the time necessary to audit the integrity of the data. However, this introduces new technological and business risks that the auditor will need to assess.

International Auditing Standards have not yet been revised in terms of how and when to use blockchain ecosystems and the risks that they create for external and fraud audits. This chapter will explain how and when to use blockchain technologies and identify the potential new risks that await the auditor. Since no definitive rules and regulations have yet been made, this study is based on the opinions of several professional bodies that are currently tackling bitcoin and other sub-tools that blockchain ecosystems are offering.


  1. Appelbaum, D., Kogan, A., & Vasarhelyi, M. (2017). Big data and analytics in the modern audit engagement: Research needs. Auditing: A Journal of Practive & Theory, 36(4), 1–27.CrossRefGoogle Scholar
  2. Bellinger, G., Castro, D., & Mills, A. (2004). Retrieved from Mental Model Musings:
  3. CPA Canada, AICPA. (2017). Blockchain technology and its potential impact on the audit and assurance profession. Toronto: Deloitte Development LLC.Google Scholar
  4. Drew, J. (2018). Paving the way to a new digital world. Journal of Accountancy, 6(225), 32–37.Google Scholar
  5. Forbes. (2018). Retrieved from Forbes.Com:
  6. Friedman, M. (1970). A theoritical framework for monetary analysis. Journal of Political Economy, 78, 193–238.CrossRefGoogle Scholar
  7. Graham Jones, T. M. (1988). Information technology and the new accounting. London: McGraw-Hill.Google Scholar
  8. Hall, J. A. (2012). Accounting information systems. Boston, MA: Cengage Learning.Google Scholar
  9. Jones, M. T., Wicks, C. A., & Freeman, R. E. (2017). Stakeholder theory: The state of art. In N. E. Bowie (Ed.), The Blackwell guide to business ethics. Oxford: Wiley.Google Scholar
  10. Karimi, K., & Atkinson, G. (2013). What the Internet of Things (IoT) needs to become a reality. White Paper, FreeScale and ARM, 1–16.Google Scholar
  11. Mahbod, R., & Hinton, C. D. (2019). Blockchain: The future of the auditing and assurance profession. Armed Forces Comptroller, 64(1), 23–27.Google Scholar
  12. Mark, G., & Simkin, J. M. (2014). Core concepts of accounting information systems. New York: Wiley.Google Scholar
  13. Nikitin, F. D. (2017). Knowledge Center: Isaca. Retrieved from Information Systems Audit and Control Association Web Page:
  14. Ortman, J. C. (2018). Blockchain and the future of the audit. CMC Seniour Thesis.Google Scholar
  15. Oxford, D. (2019). Oxford living dictionaries. Retrieved from Oxford Dictionaries Website:
  16. Psaila, S. (2017). Articles: Deloitte. Retrieved March 01, 2019, from Deloitte Web sitesi:
  17. Sadu, I. (2018). Auditing blockchain. Internal Auditor, 75(6), 17–19.Google Scholar
  18. Smith, S. (2018). Blockchain augmented audit – Benefits and challanges for accounting professionals. Journal of Theoretical Accounting Research, 14(1), 117–137.Google Scholar
  19. Spoke, M., & Steele, S. (2015). Blockchains and the future of audit. Retrieved March 01, 2019, from Coindesk Websitesi:
  20. Tapscott, A. (2016). Assurance, EY. Retrieved from Ernst&Young Web Sitesi:

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  1. 1.Faculty of Political Science, Department of Business AdministrationIstanbul UniversityFatihTurkey
  2. 2.Faculty of Business Administration, Department of Accounting and AuditingIstanbul Commerce UniversityBeyogluTurkey

Personalised recommendations